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European Equity Benchmarks Close Higher, Led by Tech, Aerospace Stocks

The broad-based major European indices closed higher in Tuesday trading as tech stocks and aerospace stocks helped boost the markets

In economic news, the euro area (EA19) exports of goods to the rest of the world in November was EUR203.0 billion ($231.9 billion), a 1.9% increase compared with November 2017 (EUR199.2 billion). Imports from the rest of the world was EUR184.0 billion, a 4.7% increase from the same month the previous year (EUR175.7 billion). As a result, the euro area recorded a EUR19.0 billion surplus in trade in goods with the rest of the world in November, compared with +EUR23.4 billion in November 2017. Intra-euro area trade rose to EUR170.5 billion in November 2018, up by 1.5% compared with November 2017.

Meanwhile the extra-EU28 area exports of goods in November was EUR172.7 billion, up 2.6% compared with November 2017 (EUR168.4 billion). Imports from the rest of the world stood at EUR175.9 billion, up 7.6% compared with November 2017 (EUR163.4 billion). As a result, the EU28 recorded a EUR3.2 billion deficit in trade in goods with the rest of the world in November, compared with a surplus of EUR4.9 billion in November 2017. Intra-EU28 trade rose to EUR313.1 billion in November, a 2.5% rise from November 2017.

In Germany, the price adjusted GDP was 1.5% higher in 2018 than in the previous year, according to the Federal Statistical Office (Destatis). Although growth lost momentum, it was ninth consecutive year that the German economy expanded. In the previous two years, the price adjusted GDP had increased 2.2% each, and economic growth in 2018 exceeded the average growth rate of the last 10 years (+1.2%).

In France, consumer prices rose in 2018 for the third consecutive year, according to the Institute for Statistics and Economic Studies (INSEE). Inflation was up 1.8% after rising 1.0% in 2017, 0.2 % in 2016, and 0.0% in 2015. In addition to a sharp increase in tobacco prices, the rise in inflation came from an acceleration in the prices of energy, services and, from a lesser decline in manufactured product prices. Core inflation rose 0.8% in 2018 after rising 0.5% in 2017.

INSEE also reported that the consumer prices index ( CPI ) was unchanged in December, after a 0.2% downturn in November. Seasonally adjusted consumer prices declined 0.2% during the month, after a 0.1% drop in November. Year on year, consumer prices slowed down for the second consecutive month, rising 1.6% in December after rising 1.9% in November, and 2.2% in October. The drop in inflation came from a year-on-year slowdown in energy, services and tobacco prices and a larger drop in manufactured product prices, while food prices accelerated.

And in Spain, the annual rate of the overall CP) in December was 1.2%, five tenths lower than the previous month, according to the Spanish Statistical Institute. The annual change of core inflation (overall index excluding unprocessed food and energy products) remained at 0.9%, which is three tenths below that of the overall CPI. In December, the monthly variation rate of the overall CPI was -0.4%.

In equities, automaker Rolls Royce, and private equity company 3i Group led the FTSE higher in London, rising 2.6% each, followed by online grocery retailer Ocado Group, which was up 2.1%. Software firm Sage Group, and commercial real estate company Land Securities, each climbed 2%. Hospitality company InterContinental, and aerospace and defense company BAE Systems each gained 1.9%, while software firm Micro Focus, stock market operator London Stock Exchange, and insurance firm Admiral Group each closed 1.8% higher.

In Paris, IT and consulting firm Cap Gemeni, and airplane manufacturer Airbus Group led the CAC higher, rising 3.8% and 2.7% respectively, followed by aerospace and defense company Safran, which climbed 2.1%. Natural gas supplier Engie, and pharmaceutical firm Sanofi were up 1.8% each, while automaker Peugeot, beverage company Pernod Ricard, semiconductor company STMicroelectronics, and oilfield services company TechnipFMC each closed 1.3% higher.

The FTSE rose 0.58%, the DAX gained 0.33%, and the CAC-40 increased 0.49%.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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